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CESC
During 2QFY2012, CESC reported 12.3% yoy growth in its standalone net sales to
`1,241cr. Top-line growth was on account of better realization, as the volume of
power generated during the quarter was flat yoy at 2,355MU. Operating profit
during the quarter decreased by 18.2% yoy to `260cr. OPM for the quarter
declined by 783bp yoy to 21.0% on account of higher other expenses. Other
expenses during the quarter were higher on a yoy basis, at `195cr, on a low base
(CESC reported negative other expenses of `14cr in 2QFY2011). Other expenses
for the quarter included cost adjustments of `67cr as against negative `217cr in
2QFY2011. On the bottom-line front, net profit decreased by 26.5% yoy to
`114cr. We maintain our Buy view on the stock; our target price is under review.
Apollo Tyres
Apollo Tyres (APTY) reported a mixed set of results for 2QFY2012. While
standalone operating performance was subdued due to adverse product mix and
continued raw-material cost pressures, European operations posted strong results
led by robust demand for winter tyres ahead of the peak season.
For 2QFY2012, APTY registered 47.3% yoy (1.7% qoq) growth in its consolidated
net revenue to `2,871cr. Top-line growth was aided by 31.9% yoy (down 4% qoq)
growth in volumes to 120,000MT and 11.7% yoy (6% qoq) growth in average net
realization. On a low base of 2QFY2011 (lock-out at Cochin plant), standalone
volumes reported a 37% yoy jump, leading to 56.9% growth in revenue; however,
on a sequential basis, standalone volumes declined by ~10%. Europe and South
Africa operations registered strong revenue growth of 42.8% and 14.8% yoy,
respectively, during the quarter.
The company's operating margin declined by 148bp yoy (49bp qoq) to 8%, mainly
due to weak operating performance at the standalone level. While average rubber
cost declined by 4.1% sequentially, cost of other raw materials such as NTC and
carbon black moved up slightly due to depreciation of the INR. As a result,
consolidated raw material to net sales ratio stood at 67.5%, witnessing an increase
of 860bp yoy and 180bp qoq. EBIT margin at the European subsidiary expanded
by 240bp yoy (85bp qoq) to 10.6%, aided by price hike undertaken in June 2011.
Net profit grew by 46% yoy to `78cr. However, on a sequential basis, net profit
stood flat. A significant increase in other income and lower tax-rate benefited the
company's bottom-line performance during the quarter. We retain our Buy rating
on the stock with a target price of `74.
Godawari Power & Ispat
Godawari Power and Ispat reported its 2QFY2012 results. Consolidated net sales
increased by 190.0% yoy to `429cr, driven by increased volumes and realization.
However, EBITDA grew only by 73.2% yoy to `53cr on account of rising prices of
key inputs. Raw-material costs as a percentage of net sales stood at 65.8% in
2QFY2012, compared to 49.1% in 2QFY2011. Thus, EBITDA margin slipped by
828bp yoy to 12.3% in 2QFY2012. Interest costs and depreciation grew by
145.0% and 51.7% yoy to `25cr and `17cr, respectively. Consequently, net profit
increased by 50.0% yoy to `11cr. We maintain our Buy rating on the stock; our
target price is under review.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
CESC
During 2QFY2012, CESC reported 12.3% yoy growth in its standalone net sales to
`1,241cr. Top-line growth was on account of better realization, as the volume of
power generated during the quarter was flat yoy at 2,355MU. Operating profit
during the quarter decreased by 18.2% yoy to `260cr. OPM for the quarter
declined by 783bp yoy to 21.0% on account of higher other expenses. Other
expenses during the quarter were higher on a yoy basis, at `195cr, on a low base
(CESC reported negative other expenses of `14cr in 2QFY2011). Other expenses
for the quarter included cost adjustments of `67cr as against negative `217cr in
2QFY2011. On the bottom-line front, net profit decreased by 26.5% yoy to
`114cr. We maintain our Buy view on the stock; our target price is under review.
Apollo Tyres
Apollo Tyres (APTY) reported a mixed set of results for 2QFY2012. While
standalone operating performance was subdued due to adverse product mix and
continued raw-material cost pressures, European operations posted strong results
led by robust demand for winter tyres ahead of the peak season.
For 2QFY2012, APTY registered 47.3% yoy (1.7% qoq) growth in its consolidated
net revenue to `2,871cr. Top-line growth was aided by 31.9% yoy (down 4% qoq)
growth in volumes to 120,000MT and 11.7% yoy (6% qoq) growth in average net
realization. On a low base of 2QFY2011 (lock-out at Cochin plant), standalone
volumes reported a 37% yoy jump, leading to 56.9% growth in revenue; however,
on a sequential basis, standalone volumes declined by ~10%. Europe and South
Africa operations registered strong revenue growth of 42.8% and 14.8% yoy,
respectively, during the quarter.
The company's operating margin declined by 148bp yoy (49bp qoq) to 8%, mainly
due to weak operating performance at the standalone level. While average rubber
cost declined by 4.1% sequentially, cost of other raw materials such as NTC and
carbon black moved up slightly due to depreciation of the INR. As a result,
consolidated raw material to net sales ratio stood at 67.5%, witnessing an increase
of 860bp yoy and 180bp qoq. EBIT margin at the European subsidiary expanded
by 240bp yoy (85bp qoq) to 10.6%, aided by price hike undertaken in June 2011.
Net profit grew by 46% yoy to `78cr. However, on a sequential basis, net profit
stood flat. A significant increase in other income and lower tax-rate benefited the
company's bottom-line performance during the quarter. We retain our Buy rating
on the stock with a target price of `74.
Godawari Power & Ispat
Godawari Power and Ispat reported its 2QFY2012 results. Consolidated net sales
increased by 190.0% yoy to `429cr, driven by increased volumes and realization.
However, EBITDA grew only by 73.2% yoy to `53cr on account of rising prices of
key inputs. Raw-material costs as a percentage of net sales stood at 65.8% in
2QFY2012, compared to 49.1% in 2QFY2011. Thus, EBITDA margin slipped by
828bp yoy to 12.3% in 2QFY2012. Interest costs and depreciation grew by
145.0% and 51.7% yoy to `25cr and `17cr, respectively. Consequently, net profit
increased by 50.0% yoy to `11cr. We maintain our Buy rating on the stock; our
target price is under review.
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